Brian Kelly is an investor and financial markets commentator, founder and CEO of BKCM LLC and one of the founders of PAR, a blockchain-based hedge fund administration system. In this opinion piece, Kelly argues that making blockchains editable allows users to rewrite history, therefore opening up financial systems to the potential for fraud. A once-in-a-generation opportunity to upgrade our defenses against financial fraud is under attack. The immutable ledger, at the heart of bitcoin and blockchain technology, prevents bad actors from changing the record. Accenture has patented a new type of blockchain that allows anyone with access to the ledger to edit entries, claiming its prototype will be more attractive because it will allow information to be changed or deleted by a central administrator. Bitcoin and its technological innovation – a blockchain – have been heralded as the cure for what ails our antiquated financial infrastructure. I believe that the immutability of a blockchain is a key feature and strength in the technology. Allowing anyone to amend or delete information from the ledger threatens our ability to fight improprieties with the game changing blockchain technology. The importance of permanence Since 2009, there have been more than 155 million bitcoin transactions. Every single one is permanently stored on bitcoin’s ledger. Every time a slice of pizza has been bought or hotel room has been booked on Expedia with bitcoin, a permanent record of the transaction is stored. Don’t worry, none of the specific details – like how many slices of pizza you bought – are stored forever, just the record that a transaction took place and that value was exchanged. Richard Lumb, Accenture’s group chief executive for financial services recently wrote: "That permanence has been vital in building trust in the decentralized currencies, which are used by millions of people […]
